"I accept that depending upon how many of those at Manus are found to be refugees, I accept that it might be hard for PNG to take all of them.

"But we're grateful for the fact that some of them will be here in PNG and we're continuing to work with other countries in our region to ensure that people don't come to Australia if they arrive illegally by boat.

"This is the bottom line: if you arrive illegally by boat in Australia, you will never permanently settle in Australia because as long as there is this prospect of permanent settlement in Australia, there is the risk that illegal boats will keep coming."

"Each party shall, subject to its laws and regulations, accord nationals of the other party fair and transparent treatment with respect to matters in connection with their business, immigration and professional activities," the treaty states.

It also sets out new rules governing aid and development cooperation in PNG, including an exemption from income tax for Australian aid organisations.